Eskan names group for key residential project

Manama, June 4, 2013

Bahrain-based Eskan Bank has appointed a consortium headed by KPMG to structure a funding programme for the development of social housing projects on its own land bank, in various areas of the kingdom.

It is aimed at providing up to 2,500 social housing units, reported the Gulf Daily News, our sister publication..

The consortium includes KPMG, Barwa Bank of Qatar, and Trowers & Hamlins.

The consultants are to study the bank's financing requirements and propose a suitable funding programme that may include debt, equity, or a mixture of both. The total development cost of the projects is estimated to reach up to BD200 million.

The bank said it will provide lands for the projects and its wholly owned subsidiary, Eskan Properties, will serve as the real estate developer.

The agreement was signed by Eskan Bank general manager Dr Khalid Abdullah and KPMG in Bahrain managing partner Jamal Fakhro, who represented the consortium of consultants.

"Eskan Bank looks forward to the creation of appropriate financing instruments to facilitate the implementation of projects aimed at meeting the housing requirements of citizens," Dr Abdullah said after the signing ceremony.

The bank is seeking structured financing programmes that allow it to monetise its land bank for further re-injection of proceeds into more social housing development projects.

"Needless to say, such a move will also help, through domestic capital, the revival of financial and construction sectors and achieve economic development," Dr Abdullah added.

As part of its new approved strategy, Eskan Bank has added a pillar focussed on assisting the Housing Ministry in reducing the waiting list of social housing service beneficiaries by building social housing projects on its own land plots, deputy general manager and chief business officer Ahmad Tayara said.

"Such plans require proper funding to be raised from local and regional capital markets.

"We are seeking an optimal funding programme that can be rolled out each time a social housing project on Eskan land is launched, while maintaining optimal pricing and bankability of the structures used.

"We hope to move towards the appointment of a mandated lead arranger to carry out the fundraising exercise later this year after obtaining the necessary internal and external approvals," Mr Tayara added.

"This pioneering project is a path-breaking initiative by Eskan Bank to also facilitate private sector participation in social housing and assisting the ministry to reduce the backlog of social housing beneficiaries," said Fakhro.-TradeArabia News Service